MUSCAT : In a detailed clarification, the Ministry of Commerce, Industry and Investment Promotion said the agreement is designed to significantly enhance trade exchange, facilitate access to goods and services, attract quality investments and expand cooperation across priority sectors for both countries. The CEPA, it added, consolidates years of growing economic engagement and opens wider horizons for trade and investment partnerships.

The ministry noted that the signing of the agreement follows the outcomes of the high-level visit of His Majesty Sultan Haitham bin Tariq to India, which laid solid foundations for deeper economic cooperation. After the visit, Oman reactivated negotiations through a comprehensive economic, legal and technical approach to ensure maximum national benefit.

Negotiations were underpinned by specialised studies, including an economic assessment prepared by Deloitte & Touche, which examined the impact of tariff liberalisation, export growth and investment expansion. The study confirmed the agreement’s feasibility and its potential to enhance the competitiveness of Omani exports and maximise added value within the national economy.

According to the ministry, talks progressed through five main negotiation rounds between 2023 and 2025, covering legal and regulatory frameworks, rules of origin, health and technical measures, trade facilitation, trade in goods and services, intellectual property, cooperation and dispute settlement. The final outcome, it said, represents a balanced formula that safeguards national interests while remaining consistent with Gulf and international commitments.

Bilateral trade between Oman and India reached around US$7 billion in 2024, positioning India as one of Oman’s leading trading partners, particularly for non-oil exports such as polyethylene, urea, gypsum, ethylene and other petrochemical and metal-related products. The ministry expects this trade to expand further under the preferential market access provided by the CEPA.

Under the agreement, Oman achieved trade liberalisation covering 97.4 per cent of its goods based on current export volumes, while market access to India reached approximately 77.8 per cent, with special treatment for strategically important products. In return, Oman granted India phased customs liberalisation reaching 99.22 per cent, aligned with national economic objectives and the protection of local industries.

The CEPA comprises 16 main chapters and technical annexes regulating trade in goods and services, customs duties, import and export procedures, rules of origin, trade remedies, sanitary and technical measures, intellectual property, the movement of natural persons, SMEs, economic and technical cooperation, and transparency in services trade. Strong safeguards have been included to protect national industries, alongside provisions ensuring the continued application of Omanisation policies and professions restricted to Omanis.

On investment, the ministry highlighted that India ranks among the top ten investing countries in Oman, with foreign direct investments amounting to approximately RO 286 million in the first quarter of 2025. These investments span iron and steel, fertilisers, clean energy, healthcare and petrochemicals, supporting industrial value chains, boosting production capacity and creating jobs.

The agreement is also expected to enhance food and drug security and strengthen cooperation in agriculture, health, biotechnology, digital trade, logistics, mining, innovation, space and tourism, in line with the objectives of Oman Vision 2040. The ministry noted the active participation of the Omani private sector throughout the negotiations, ensuring the agreement reflects market realities and opportunities for national companies.

Reaffirming that the CEPA does not conflict with GCC commitments or disrupt intra-Gulf trade, the ministry said government procurement was excluded to preserve legislative sovereignty, with legal reviews confirming full compliance with national and international laws.

Economic estimates indicate that reducing average Indian tariffs, previously around 17 per cent, will significantly boost the competitiveness of Omani goods, granting access to a market valued at over US$17 trillion and a consumer base exceeding 400 million people. Lower duties on Indian raw materials are also expected to reduce production costs in Oman and strengthen its role as a regional trade and logistics hub.

To ensure smooth implementation, the ministry announced the formation of a national rapid intervention team to address any challenges faced by affected sectors, while legislative and legal procedures for ratification are completed ahead of the agreement’s entry into force. The CEPA, the ministry stressed, will reinforce Oman’s position in the global trading system and support its transition towards a diversified, competitive and value-driven economy.

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